Waterview Estates Owners Association, Inc.€¦ · Reserve Advisors, Inc. Years 2016 to 2031 RESERVE EXPENDITURES Explanatory Notes: Waterview Estates 1) 3.0% is the estimated future

FULL RESERVE STUDYWaterview Estates

Owners Association, Inc.

Richmond, Texas

April 20, 2016

This Report contains intellectual property developed by Reserve Advisors, Inc.

and cannot be reproduced or distributed to those who conduct reserve studies

without their written consent.

© Reserve Advisors, Inc. 2016

For Waterview Estates Owners Association, Inc.

Name:___________________________

Title:____________________________

Date:_______________

Phone:___________________________

Agent or Manager: Kristi Miller

Management Firm: NeighborLink Management

For: Reserve Advisors, Inc.

Signature: _______________________

Jacque MartinDirector of Texas Client [email protected]. # 151249(800) 221-9882

Reserve Study UpdateMay 10, 2016

The Reserve Study for Waterview Estates Owners Association, Inc.Was submitted on ………………………………………………………….May 10, 2016

To maintain the most accurate and cost-effective replacement schedule and funding plan foryour property elements, this study should be updated on or about ..........Second Quarter, 2018…but no later than………………………………………………………….….Second Quarter, 2019

As a valued client, we are pleased to offer a future reserve study update with site visitfor………$3,000For a Reserve Study Update with Site visit as noted above.This future update fee is based on the same property components that were contained in your last ReserveAdvisors’ reserve study or update. We are pleased to include property additions for an additional fee.

To initiate your Reserve Study Update, please sign this authorization and fax or mail to thenumber below. Upon receipt of this authorization we will contact you to schedule your site visitand invoice for the Reserve Study Update Service.

Sign this contract below and fax to 414-272-3663. Or mail toReserve Advisors, Inc.735 N. Water St., Suite 175Milwaukee, WI 53202

Delivery options for your Reserve Study Update Report, Please check one of the following:

____ 1-Full color printed copy PLUS Electronic Report, FREE

____ 2-Full color printed copies PLUS Electronic Report, $100

CORPORATE OFFICEReserve Advisors, Inc.

735 N. Water Street, Suite 175Milwaukee, WI 53202



TABLE OF CONTENTS

1. RESERVE STUDY EXECUTIVE SUMMARY .......................................................1.1

2. RESERVE STUDY REPORT ....................................................................................2.1

3. RESERVE EXPENDITURES and FUNDING PLAN .............................................3.1

4. CONDITION ASSESSMENT.....................................................................................4.1

Property Site Elements ...................................................................................................4.1

Concrete, Flatwork ...................................................................................................4.1

Concrete Parking Area .................................................................................4.2

Concrete Sidewalks ......................................................................................4.2

Fences, Chain Link ..................................................................................................4.3

Fences, Metal ...........................................................................................................4.3

Fences, Wood ...........................................................................................................4.5

Irrigation System ......................................................................................................4.7

Landscape, Partial Replacements.............................................................................4.8

Light Poles and Fixtures ..........................................................................................4.9

Playground Equipment.............................................................................................4.9

Ponds, Aerator..........................................................................................................4.11

Signage, Entrance Monument ..................................................................................4.12

Tennis Courts ...........................................................................................................4.12

Color Coat ....................................................................................................4.13

Fence ............................................................................................................4.13

Light Poles and Fixtures ..............................................................................4.14

Surface .........................................................................................................4.14

Clubhouse Elements.......................................................................................................4.15

HVAC Equipment, Split System .............................................................................4.15

Interior Renovations.................................................................................................4.16

Roof Assemblies, Metal ...........................................................................................4.17

Security System .......................................................................................................4.18

Windows and Doors .................................................................................................4.18

Pool Elements ................................................................................................................4.19

Concrete Deck ..........................................................................................................4.20

Furniture ...................................................................................................................4.21

Mechanical Equipment ............................................................................................4.22

Pool Finish, Plaster ..................................................................................................4.23

Shade Structures.......................................................................................................4.23

Water Features and Slide .........................................................................................4.24

Reserve Study Update ....................................................................................................4.26

5. METHODOLOGY ......................................................................................................5.1

6. DEFINITIONS .............................................................................................................6.1

7. PROFESSIONAL SERVICE CONDITIONS ...........................................................7.1

8. CREDENTIALS ...........................................................................................................8.1

1. RESERVE STUDY EXECUTIVE SUMMARY

Client: Waterview Estates Owners Association, Inc. (Waterview Estates) Location: Richmond, Texas Reference: 151249 Property Basics: Waterview Estates Owners Association, Inc. is a planned unit development responsible for the common elements shared by 1,172 single family homes. The development was built from 2003 to 2016 and contains fences, tennis courts, a clubhouse, pool and splash pad. The clubhouse, pool and surrounding amenities were built in approximately 2005. Reserve Components Identified: 39 Reserve Components. Inspection Date: April 20, 2016. Funding Goal: The Funding Goal of this Reserve Study is to maintain reserves above an adequate, not excessive threshold during one or more years of significant expenditures. Our recommended Funding Plan recognizes this threshold funding year in 2045 due to replacement of the irrigation system, pool plaster finish and water features at the splash pad and pool. Cash Flow Method: We use the Cash Flow Method to compute the Reserve Funding Plan. This method offsets future variable Reserve Expenditures with existing and future stable levels of reserve funding. Our application of this method also considers:

• current and future local costs of replacement • 1.35% annual rate of return on invested reserves • 3.0% future Inflation Rate for estimating Future Replacement Costs

Sources for Local Costs of Replacement: Our proprietary database, historical costs and published sources, i.e., R.S. Means, Incorporated. Cash Status of Reserve Fund: $189,618 as of February 29, 2016. A potential deficit in reserves might occur by 2025 based upon continuation of the most recent annual reserve contribution of $49,250 and the identified Reserve Expenditures. Recommended Reserve Funding: The Association budgeted $49,250 for Reserve Contributions in 2016. We recommend the Association adopt a Reserve Budget of $85,000 in 2017. Afterwards, the Association should budget gradual annual increases in reserve funding that in part consider the effects of inflation through 2046, the limit of this study's Cash Flow Analysis. The initial adjustment in Reserve Contributions of $35,750 represents about a five percent (4.9%) adjustment in the 2016 total Operating Budget of $724,927. This initial adjustment of $35,750 is equivalent to an increase of $30.50 in the annual contributions per homeowner. Certification: This Full Reserve Study exceeds the Community Associations Institute (CAI) and the Association of Professional Reserve Analysts (APRA) standards fulfilling the requirements of a “Level I Full Reserve Study.”

Reserve Advisors, Inc. 735 N. Water Street, Suite 175

Milwaukee, WI 53202

Page 1.2 - Executive Summary

Waterview Estates Recommended Reserve Funding Table and Graph

Respectfully submitted on May 10, 2016 by RESERVE ADVISORS, INC.

Alan M. Ebert, PRA1, RS2, Director of Quality Assurance Reviewed by: Nicole L. Lowery, PRA, RS, Associate Director of Quality Assurance Visual Inspection and Report by: Timothy J. Matthiesen, RS 1PRA (Professional Reserve Analyst) is the professional designation of the Association of Professional Reserve Analysts. Learn more about APRA at http://www.apra-usa.com. 2 RS (Reserve Specialist) is the reserve provider professional designation of the Community Associations Institute (CAI) representing America's more than 300,000 condominium, cooperative and homeowners associations.

YearReserve

Contributions ($)Reserve

Balances ($) YearReserve


Balances ($) YearReserve


Balances ($)2017 85,000 199,583 2027 114,200 428,568 2037 153,400 423,8652018 87,600 258,077 2028 117,600 523,609 2038 158,000 588,6542019 90,200 352,370 2029 121,100 518,410 2039 162,700 500,3122020 92,900 438,189 2030 124,700 536,741 2040 167,600 675,7982021 95,700 271,938 2031 128,400 618,357 2041 172,600 644,4572022 98,600 360,854 2032 132,300 687,903 2042 177,800 399,8822023 101,600 349,010 2033 136,300 488,074 2043 183,100 383,8792024 104,600 459,028 2034 140,400 636,011 2044 188,600 470,6762025 107,700 429,939 2035 144,600 494,028 2045 194,300 81,1702026 110,900 509,738 2036 148,900 599,999 2046 200,100 113,076

Page 2.1 - Report

2. RESERVE STUDY REPORT

At the direction of the Board that recognizes the need for proper reserve planning, we

have conducted a Full Reserve Study of

Waterview Estates Owners Association, Inc.

Richmond, Texas

and submit our findings in this report. The effective date of this study is the date of our visual,

noninvasive inspection, April 20, 2016.

We present our findings and recommendations in the following report sections and

spreadsheets:

• Identification of Property - Segregates all property into several areas of responsibility for repair or replacement

• Reserve Expenditures - Identifies reserve components and related quantities, useful lives, remaining useful lives and future reserve expenditures during the next 30 years

• Reserve Funding Plan - Presents the recommended Reserve Contributions and year-end Reserve Balances for the next 30 years

• Condition Assessment - Describes the reserve components, describes our recommendations for repairs or replacement, and includes detailed solutions and procedures for replacements for the benefit of current and future board members

• Photographs - Documentation of Condition of various property elements • Methodology - Lists the national standards, methods and procedures used,

financial information relied upon for the Financial Analysis of the Reserve Study • Definitions - Contains definitions of terms used in the Reserve Study, consistent

with national standards • Professional Service Conditions - Describes Assumptions and Professional

Service Conditions • Credentials and Resources

Page 2.2 - Report

IDENTIFICATION OF PROPERTY

Waterview Estates Owners Association, Inc. is a planned unit development responsible

for the common elements shared by 1,172 single family homes. The development was built from

2003 to 2016 and contains fences, tennis courts, a clubhouse, pool and splash pad. We identify

39 major reserve components that are likely to require capital repair or replacement during the

next 30 years.

Our investigation includes Reserve Components or property elements as set forth in your

Declaration. Our analysis begins by segregating the property elements into several areas of

responsibility for repair and replacement. Our process of identification helps assure that future

boards and the management team understand whether reserves, the operating budget or

Homeowners fund certain replacements and assists in preparation of the annual budget. We

derive these segregated classes of property from our review of the information provided by the

Page 2.3 - Report

Association and through conversations with Management and the Board. These classes of

property include:

• Reserve Components • Long-Lived Property Elements • Operating Budget Funded Repairs and Replacements • Property Maintained by Homeowners • Property Maintained by Others

We advise the Board conduct an annual review of these classes of property to confirm its

policy concerning the manner of funding, i.e., from reserves or the operating budget.

The Reserve Study identifies Reserve Components as set forth in your Declaration or which were

identified as part of your request for proposed services. Reserve Components are defined by

CAI as property elements with:

• Waterview Estates responsibility • Limited useful life expectancies • Predictable remaining useful life expectancies • Replacement cost above a minimum threshold

Long-Lived Property Elements do not have predictable Remaining Useful Lives. The

operating budget should fund infrequent repairs. Funding untimely or unexpected replacements

from reserves will necessitate increases to Reserve Contributions. Periodic updates of this

Reserve Study will help determine the merits of adjusting the Reserve Funding Plan. We

identify the following Long-Lived Property Elements as excluded from reserve funding at this

time.

• Electrical System, Common • Foundation, Clubhouse and Pool House • Pipes, Interior Building, Water and Sewer, Clubhouse • Pool Structure • Structural Frame, Clubhouse and Pool House • Walls, Fiber Cement Siding, Clubhouse and Pool House • Well Casings, Pond Wells

Page 2.4 - Report

The operating budget provides money for the repair and replacement of certain Reserve

Components. Operating Budget Funded Repairs and Replacements relate to:

• General Maintenance to the Common Elements • Expenditures less than $7,000 (These relatively minor expenditures have a

limited effect on the recommended Reserve Contributions.) • Baseball Diamond (Excluding Fence and Backstop) • Clubhouse, Interim Paint Finishes and Appliance and Furnishing Replacements • Fences, Columns, Masonry • Irrigation System, Controllers • Landscape (Excludes Near Term Additions) • Monuments, Neighborhoods • Parking Areas, Joint Sealant • Pool and Clubhouse Access Systems • Signage, Informational • Site Furniture, Interim Replacements • Soccer Field • Tennis Courts, Wind Screens • Walls, Fiber Cement Siding, Paint Finishes, Clubhouse and Pool House • Other Repairs normally funded through the Operating Budget

Certain items have been designated as the responsibility of the homeowners to repair or

replace at their cost. Property Maintained by Homeowners, including items billed back to

Homeowners, relates to:

• Fences at Lot Lines (Excluding Waterview Estates Trail) • Homes and Lots

Certain items have been designated as the responsibility of others to repair or replace.

Property Maintained by Others relates to:

• Light Poles and Fixtures, Streets (Center Point Energy) • Mailbox Stations (United States Postal Service) • Ponds, Erosion Control and Sediment Removal (Municipal Utility District) • Pool Chlorination System (Leased) • Sidewalks, Parallel to Streets (Fort Bend County) • Street Systems (Fort Bend County)

Page 3.1 - Reserve Expenditures and Funding Plan

3. RESERVE EXPENDITURES and FUNDING PLAN

The tables following this introduction present:

Reserve Expenditures

• Line item numbers • Total quantities • Quantities replaced per phase (in a single year) • Reserve component inventory • Estimated first year of event (i.e., replacement, application, etc.) • Life analysis showing

− useful life − remaining useful life

• Unit cost of replacement • 2016 local cost of replacement • Total future costs of replacement anticipated during the next 30 years • Schedule of estimated future costs for each reserve component including

inflation

Reserve Funding Plan

• Reserves at the beginning of each year • Total recommended reserve contributions • Estimated interest earned from invested reserves • Anticipated expenditures by year • Anticipated reserves at year end • Predicted reserves based on current funding level

Financial statements prepared by your association, by you or others might rely in part on

information contained in this section. For your convenience, we have provided an electronic

data file containing the tables of Reserve Expenditures and Reserve Funding Plan.

Page 3.2 - Reserve Expenditures and Funding Plan

The following chart illustrates the relative importance of the categories noted in Reserve

Expenditures and relative funding during the next 30 years.

Waterview Estates Future Expenditures Relative Cost Illustration

Reserve Advisors, Inc. Years 2016 to 2031RESERVE EXPENDITURES

Explanatory Notes:

Waterview Estates 1) 3.0% is the estimated future Inflation Rate for estimating Future Replacement Costs.

Owners Association, Inc. 2) FY2016 is Fiscal Year beginning January 1, 2016 and ending December 31, 2016.Richmond, Texas Estimated Life Analysis, Costs, $

Line Total Per Phase 1st Year of Years Unit Per Phase Total 30-Year Total RUL = 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15Item Quantity Quantity Units Reserve Component Inventory Event Useful Remaining (2016) (2016) (2016) (Inflated) FY2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031

----------------------------- -------------- -------------------- ------------------------------------------------------------------------------------------------------------ ---------------- ------------ ----------------- ---------------- -------------------------------------- --------------------- ----------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------

Property Site Elements

4.120 19,100 1,910 Square Feet Concrete Parking Area, Partial 2026 to 65 10 to 30+ 10.00 19,100 191,000 106,527 25,669

4.140 9,700 970 Square Feet Concrete Sidewalks, Partial 2026 to 65 10 to 30+ 9.00 8,730 87,300 48,689 11,732

4.220 700 700 Linear Feet Fences, Chain Link, Baseball Diamond (Incl. Backstop) 2028 to 25 12 29.00 20,300 20,300 28,943 28,943

4.240 2,020 2,020 Linear Feet Fences, Metal, Paint Finishes (Quantity Varies by Year) 2017 6 to 8 1 5.50 11,110 11,110 64,824 11,443 13,664 7,108

4.245 880 880 Linear Feet Fences, Metal, Belfort Street, Replacement 2041 to 35 25 70.00 61,600 61,600 128,977

4.246 520 520 Linear Feet Fences, Metal, Pool, Replacement 2029 to 25 13 55.00 28,600 28,600 42,000 42,000

4.247 620 620 Linear Feet Fences, Metal, Splash Pad, Replacement 2029 to 25 13 38.00 23,560 23,560 34,599 34,599

4.280 6,890 6,890 Linear Feet Fences, Wood, Paint Finishes (Quantity Varies by Year) 2017 4 to 6 1 4.90 33,761 33,761 342,660 32,351 7,195 44,050 49,579

4.285 590 590 Linear Feet Fences, Wood, Belfort Street, Replacement 2033 15 to 20 17 28.00 16,520 16,520 27,305

4.286 480 480 Linear Feet Fences, Wood, North Pocket Parks, Replacement 2017 15 to 20 1 28.00 13,440 13,440 36,057 13,843

4.287 5,820 5,820 Linear Feet Fences, Wood, Waterview Estates Trail, Replacement 2021 15 to 20 5 28.00 162,960 162,960 492,069 188,915

4.410 1 1 Each Irrigation System, Pump 2023 to 20 7 15,000.00 15,000 15,000 51,767 18,448

4.420 175 35 Zones Irrigation System, Total Replacement, Phased 2042 to 40 26 to 30 1,200.00 42,000 210,000 480,885

4.500 1 1 Allowance Landscape, Near Term Entrance Addition (2017 is Budgeted) 2017 n/a 1 60,000.00 60,000 60,000 60,000 60,000

4.560 4 4 Each Light Poles and Fixtures, Amenity Center 2033 to 30 17 2,900.00 11,600 11,600 19,173

4.660 1 1 Allowance Playground Equipment, Amenity Center, North Pocket Parks and Splash Pad 2023 15 to 20 7 70,000.00 70,000 70,000 224,242 86,091

4.661 1 1 Allowance Playground Equipment, Jay Thrush Drive 2027 15 to 20 11 35,000.00 35,000 35,000 126,193 48,448

4.662 1 1 Allowance Playground Equipment, Quill Rush Drive 2031 15 to 20 15 35,000.00 35,000 35,000 54,529 54,529

4.700 1 1 Each Ponds, Aerator 2020 10 to 15 4 5,000.00 5,000 5,000 25,092 5,628

4.810 1 1 Allowance Signage, Entrance Monument 2045 to 30 29 20,000.00 20,000 20,000 47,131

4.830 12,960 12,960 Square Feet Tennis Courts, Color Coat 2017 4 to 6 1 0.90 11,664 11,664 82,502 12,014 13,927 16,146

4.840 480 480 Linear Feet Tennis Courts, Fence 2027 to 25 11 44.00 21,120 21,120 29,235 29,235

4.850 9 9 Each Tennis Courts, Light Poles and Fixtures 2032 to 30 16 3,100.00 27,900 27,900 44,771

4.860 12,960 12,960 Square Feet Tennis Courts, Surface Replacement 2042 to 40 26 10.00 129,600 129,600 279,494

Clubhouse Elements

5.450 1 1 Each HVAC Equipment, Split System 2020 12 to 18 4 6,000.00 6,000 6,000 17,274 6,753

5.500 1 1 Allowance Interior Renovation, Complete 2030 to 25 14 64,500.00 64,500 64,500 97,562 97,562

5.510 1 1 Allowance Interior Renovation, Partial 2018 10 to 15 2 17,000.00 17,000 17,000 54,697 18,035

5.600 44 44 Squares Roof Assemblies, Metal 2033 to 30 17 780.00 34,320 34,320 56,726

5.700 1 1 Allowance Security System 2025 to 10 9 18,500.00 18,500 18,500 100,174 24,138

5.800 380 380 Square Feet Windows and Doors 2033 to 30 17 55.00 20,900 20,900 34,545

Printed on 5/10/2016 Expenditures - Page 3.3 - 1 of 4

Reserve Advisors, Inc.

RESERVE EXPENDITURES

Waterview EstatesOwners Association, Inc.

Richmond, Texas Estimated Life Analysis, Costs, $

Line Total Per Phase 1st Year of Years Unit Per Phase Total 30-Year TotalItem Quantity Quantity Units Reserve Component Inventory Event Useful Remaining (2016) (2016) (2016) (Inflated)

----------------------------- -------------- -------------------- ------------------------------------------------------------------------------------------------------------ ---------------- ------------ ----------------- ---------------- -------------------------------------- ---------------------


4.120 19,100 1,910 Square Feet Concrete Parking Area, Partial 2026 to 65 10 to 30+ 10.00 19,100 191,000 106,527

4.140 9,700 970 Square Feet Concrete Sidewalks, Partial 2026 to 65 10 to 30+ 9.00 8,730 87,300 48,689

4.220 700 700 Linear Feet Fences, Chain Link, Baseball Diamond (Incl. Backstop) 2028 to 25 12 29.00 20,300 20,300 28,943

4.240 2,020 2,020 Linear Feet Fences, Metal, Paint Finishes (Quantity Varies by Year) 2017 6 to 8 1 5.50 11,110 11,110 64,824

4.245 880 880 Linear Feet Fences, Metal, Belfort Street, Replacement 2041 to 35 25 70.00 61,600 61,600 128,977

4.246 520 520 Linear Feet Fences, Metal, Pool, Replacement 2029 to 25 13 55.00 28,600 28,600 42,000

4.247 620 620 Linear Feet Fences, Metal, Splash Pad, Replacement 2029 to 25 13 38.00 23,560 23,560 34,599

4.280 6,890 6,890 Linear Feet Fences, Wood, Paint Finishes (Quantity Varies by Year) 2017 4 to 6 1 4.90 33,761 33,761 342,660

4.285 590 590 Linear Feet Fences, Wood, Belfort Street, Replacement 2033 15 to 20 17 28.00 16,520 16,520 27,305

4.286 480 480 Linear Feet Fences, Wood, North Pocket Parks, Replacement 2017 15 to 20 1 28.00 13,440 13,440 36,057

4.287 5,820 5,820 Linear Feet Fences, Wood, Waterview Estates Trail, Replacement 2021 15 to 20 5 28.00 162,960 162,960 492,069

4.410 1 1 Each Irrigation System, Pump 2023 to 20 7 15,000.00 15,000 15,000 51,767

4.420 175 35 Zones Irrigation System, Total Replacement, Phased 2042 to 40 26 to 30 1,200.00 42,000 210,000 480,885

4.500 1 1 Allowance Landscape, Near Term Entrance Addition (2017 is Budgeted) 2017 n/a 1 60,000.00 60,000 60,000 60,000

4.560 4 4 Each Light Poles and Fixtures, Amenity Center 2033 to 30 17 2,900.00 11,600 11,600 19,173

4.660 1 1 Allowance Playground Equipment, Amenity Center, North Pocket Parks and Splash Pad 2023 15 to 20 7 70,000.00 70,000 70,000 224,242

4.661 1 1 Allowance Playground Equipment, Jay Thrush Drive 2027 15 to 20 11 35,000.00 35,000 35,000 126,193

4.662 1 1 Allowance Playground Equipment, Quill Rush Drive 2031 15 to 20 15 35,000.00 35,000 35,000 54,529

4.700 1 1 Each Ponds, Aerator 2020 10 to 15 4 5,000.00 5,000 5,000 25,092

4.810 1 1 Allowance Signage, Entrance Monument 2045 to 30 29 20,000.00 20,000 20,000 47,131

4.830 12,960 12,960 Square Feet Tennis Courts, Color Coat 2017 4 to 6 1 0.90 11,664 11,664 82,502

4.840 480 480 Linear Feet Tennis Courts, Fence 2027 to 25 11 44.00 21,120 21,120 29,235

4.850 9 9 Each Tennis Courts, Light Poles and Fixtures 2032 to 30 16 3,100.00 27,900 27,900 44,771

4.860 12,960 12,960 Square Feet Tennis Courts, Surface Replacement 2042 to 40 26 10.00 129,600 129,600 279,494

Clubhouse Elements

5.450 1 1 Each HVAC Equipment, Split System 2020 12 to 18 4 6,000.00 6,000 6,000 17,274

5.500 1 1 Allowance Interior Renovation, Complete 2030 to 25 14 64,500.00 64,500 64,500 97,562

5.510 1 1 Allowance Interior Renovation, Partial 2018 10 to 15 2 17,000.00 17,000 17,000 54,697

5.600 44 44 Squares Roof Assemblies, Metal 2033 to 30 17 780.00 34,320 34,320 56,726

5.700 1 1 Allowance Security System 2025 to 10 9 18,500.00 18,500 18,500 100,174

5.800 380 380 Square Feet Windows and Doors 2033 to 30 17 55.00 20,900 20,900 34,545

Years 2032 to 2046

16 17 18 19 20 21 22 23 24 25 26 27 28 29 302032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046

-------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------

34,497 46,361

15,767 21,190

19,481 13,128

128,977

47,690 11,547 70,688 79,560

27,305

22,214

303,154

33,319

90,577 93,294 96,093 98,976 101,945

19,173

138,151

77,745

8,024 11,440

47,131

18,717 21,698

44,771

279,494

10,521

36,662

56,726

32,440 43,596

34,545


Reserve Advisors, Inc. Years 2016 to 2031RESERVE EXPENDITURES

Explanatory Notes:

Waterview Estates 1) 3.0% is the estimated future Inflation Rate for estimating Future Replacement Costs.

Owners Association, Inc. 2) FY2016 is Fiscal Year beginning January 1, 2016 and ending December 31, 2016.Richmond, Texas Estimated Life Analysis, Costs, $

Line Total Per Phase 1st Year of Years Unit Per Phase Total 30-Year Total RUL = 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15Item Quantity Quantity Units Reserve Component Inventory Event Useful Remaining (2016) (2016) (2016) (Inflated) FY2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031

----------------------------- -------------- -------------------- ------------------------------------------------------------------------------------------------------------ ---------------- ------------ ----------------- ---------------- -------------------------------------- --------------------- ----------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------

Pool Elements

6.200 7,750 7,750 Square Feet Concrete Deck, Inspections, Partial Replacements and Repairs 2025 8 to 12 9 1.50 11,625 11,625 62,948 15,168

6.500 1 1 Allowance Furniture 2018 to 12 2 10,500.00 10,500 10,500 49,665 11,139 15,882

6.600 2 1 Allowance Mechanical Equipment, Phased 2021 to 15 5 to 11 11,500.00 11,500 23,000 98,056 13,332 15,919

6.800 5,690 5,690 Square Feet Pool Finish, Plaster 2025 8 to 12 9 8.00 45,520 45,520 246,484 59,393

6.880 2,400 2,400 Square Feet Shade Structures, Canvas Replacement (Incl. Playground) 2021 6 to 8 5 6.00 14,400 14,400 98,982 16,694 19,933

6.890 2,400 2,400 Square Feet Shade Structures, Total Replacement (Incl. Playground) 2033 15 to 20 17 15.00 36,000 36,000 59,503

6.970 1 1 Allowance Water Features and Slide, Refinishing and Repairs (Incl. Splash Pad) 2021 6 to 8 5 35,000.00 35,000 35,000 167,501 40,575

6.980 1 1 Allowance Water Features, Replacement 2027 15 to 20 11 52,000.00 52,000 52,000 194,521 71,980

6.990 1 1 Allowance Water Slide, Replacement 2035 15 to 20 19 75,000.00 75,000 75,000 131,513

1 Allowance Reserve Study Update with Site Visit 2018 2 2 3,000.00 3,000 3,000 3,000 3,000------------------------------------------------------------------------------------------------------------ ----------------------------- ----------------- ---------------- -------------------------------------- --------------------- ----------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------Anticipated Expenditures, By Year $4,350,815 0 129,651 32,174 0 12,381 266,711 13,927 118,203 0 142,749 37,401 201,661 28,943 133,286 113,444 54,529


Reserve Advisors, Inc.

RESERVE EXPENDITURES

Waterview EstatesOwners Association, Inc.

Richmond, Texas Estimated Life Analysis, Costs, $

Line Total Per Phase 1st Year of Years Unit Per Phase Total 30-Year TotalItem Quantity Quantity Units Reserve Component Inventory Event Useful Remaining (2016) (2016) (2016) (Inflated)

----------------------------- -------------- -------------------- ------------------------------------------------------------------------------------------------------------ ---------------- ------------ ----------------- ---------------- -------------------------------------- ---------------------

Pool Elements

6.200 7,750 7,750 Square Feet Concrete Deck, Inspections, Partial Replacements and Repairs 2025 8 to 12 9 1.50 11,625 11,625 62,948

6.500 1 1 Allowance Furniture 2018 to 12 2 10,500.00 10,500 10,500 49,665

6.600 2 1 Allowance Mechanical Equipment, Phased 2021 to 15 5 to 11 11,500.00 11,500 23,000 98,056

6.800 5,690 5,690 Square Feet Pool Finish, Plaster 2025 8 to 12 9 8.00 45,520 45,520 246,484

6.880 2,400 2,400 Square Feet Shade Structures, Canvas Replacement (Incl. Playground) 2021 6 to 8 5 6.00 14,400 14,400 98,982

6.890 2,400 2,400 Square Feet Shade Structures, Total Replacement (Incl. Playground) 2033 15 to 20 17 15.00 36,000 36,000 59,503

6.970 1 1 Allowance Water Features and Slide, Refinishing and Repairs (Incl. Splash Pad) 2021 6 to 8 5 35,000.00 35,000 35,000 167,501

6.980 1 1 Allowance Water Features, Replacement 2027 15 to 20 11 52,000.00 52,000 52,000 194,521

6.990 1 1 Allowance Water Slide, Replacement 2035 15 to 20 19 75,000.00 75,000 75,000 131,513

1 Allowance Reserve Study Update with Site Visit 2018 2 2 3,000.00 3,000 3,000 3,000------------------------------------------------------------------------------------------------------------ ----------------------------- ----------------- ---------------- -------------------------------------- ---------------------Anticipated Expenditures, By Year $4,350,815

Years 2032 to 2046

16 17 18 19 20 21 22 23 24 25 26 27 28 29 302032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046

-------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------

20,385 27,395

22,644

19,008 22,696 27,101

79,820 107,271

28,420 33,935

59,503

57,850 69,076

122,541

131,513

-------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- --------------71,512 344,014 0 294,160 50,264 336,399 0 258,343 0 212,793 429,377 204,358 107,533 587,506 169,496


Reserve Advisors, Inc. Page 1 of 1

RESERVE FUNDING PLAN

CASH FLOW ANALYSISWaterview Estates

Owners Association, Inc. Individual Reserve Budgets & Cash Flows for the Next 30 YearsRichmond, Texas FY2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031

Reserves at Beginning of Year (Note 1) 189,618 241,278 199,583 258,077 352,370 438,189 271,938 360,854 349,010 459,028 429,939 509,738 428,568 523,609 518,410 536,741Total Recommended Reserve Contributions (Note 2) 49,250 85,000 87,600 90,200 92,900 95,700 98,600 101,600 104,600 107,700 110,900 114,200 117,600 121,100 124,700 128,400

Plus Estimated Interest Earned, During Year (Note 3) 2,410 2,956 3,068 4,093 5,300 4,761 4,243 4,759 5,418 5,960 6,300 6,291 6,384 6,986 7,075 7,745Less Anticipated Expenditures, By Year 0 (129,651) (32,174) 0 (12,381) (266,711) (13,927) (118,203) 0 (142,749) (37,401) (201,661) (28,943) (133,286) (113,444) (54,529)

----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- -----------------Anticipated Reserves at Year End $241,278 $199,583 $258,077 $352,370 $438,189 $271,938 $360,854 $349,010 $459,028 $429,939 $509,738 $428,568 $523,609 $518,410 $536,741 $618,357

Predicted Reserves based on 2016 funding level of: $49,250 241,278 163,592 182,992 235,045 275,336 60,123 96,496 28,380 78,346 (14,726) (2,996)

(continued) Individual Reserve Budgets & Cash Flows for the Next 30 Years, Continued2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046

Reserves at Beginning of Year 618,357 687,903 488,074 636,011 494,028 599,999 423,865 588,654 500,312 675,798 644,457 399,882 383,879 470,676 81,170Total Recommended Reserve Contributions 132,300 136,300 140,400 144,600 148,900 153,400 158,000 162,700 167,600 172,600 177,800 183,100 188,600 194,300 200,100

Plus Estimated Interest Earned, During Year 8,758 7,885 7,537 7,577 7,335 6,865 6,789 7,301 7,886 8,852 7,002 5,255 5,730 3,700 1,302Less Anticipated Expenditures, By Year (71,512) (344,014) 0 (294,160) (50,264) (336,399) 0 (258,343) 0 (212,793) (429,377) (204,358) (107,533) (587,506) (169,496)

----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- -----------------Anticipated Reserves at Year End $687,903 $488,074 $636,011 $494,028 $599,999 $423,865 $588,654 $500,312 $675,798 $644,457 $399,882 $383,879 $470,676 $81,170 $113,076

(NOTE 5) (NOTE 4)

Explanatory Notes:1) Year 2016 starting reserves are as of February 29, 2016; FY2016 starts January 1, 2016 and ends December 31, 2016.2) Reserve Contributions for 2016 are budgeted; 2017 is the first year of recommended contributions.3) 1.35% is the estimated annual rate of return on invested reserves; 2016 is a partial year of interest earned.4) Accumulated year 2046 ending reserves consider the age, size, overall condition and complexity of the property.5) Threshold Funding Year (reserve balance at critical point).

Printed on 5/10/2016 Funding Plan - Page 3.4

Page 4.1 - Condition Assessment

4. CONDITION ASSESSMENT

The Condition Assessment of this Full Reserve Study includes

Enhanced Solutions and Procedures for select significant components. These narratives describe

the Reserve Components, document specific problems and conditions, and may include detailed

solutions and procedures for necessary capital repairs and replacements for the benefit of current

and future board members. We advise the Board use this information to help define the scope

and procedures for repair or replacement when soliciting bids or proposals from contractors.

However, the Report in whole or part is not and should not be used as a design specification or

design engineering service.


Concrete, Flatwork - The Association maintains various applications of concrete

flatwork including parking areas and sidewalks.

Concrete parking area in good condition

Isolated concrete sidewalk deterioration along joint

These applications of concrete have useful lives of up to 65 years although isolated

deterioration of limited areas of concrete is common. Inclement weather, inadequate subsurface

preparation and improper concrete mixtures or finishing techniques can result in premature

deterioration such as settlement, chips, cracks and spalls. Variable conditions like these result in


the need to plan for periodic partial replacements of the concrete flatwork throughout the next 30

years. We comment on the respective quantities, conditions and times of partial replacements of

concrete flatwork in the following sections of this narrative.

Concrete Parking Area – The Association maintains the concrete parking area

near the clubhouse that comprises approximately 19,100 square feet. The parking area is

original and in good condition. We estimate that up to 5,730 square feet of concrete or

thirty percent (30%) of the total, will require replacement during the next 30 years. We

advise the Association budget for the replacement of 1,910 square feet every 10 years

beginning by 2026. Line Item 4.120 of Reserve Expenditures notes our estimate of

future costs and anticipated times of replacements.

Concrete Sidewalks - Concrete sidewalks comprise 9,700 square feet at the

common areas throughout the community. The sidewalks are in good overall condition.

We estimate that up to 2,910 square feet of concrete sidewalks, or thirty percent (30%) of

the total, will require replacement during the next 30 years. We recommend the

Association budget for replacement of 970 square feet of concrete sidewalks every 10

years beginning by 2026. Line Item 4.140 of Reserve Expenditures notes our estimate of

future costs and anticipated times of replacements. We base our estimate of replacement

on four-inch thick, 3,000 pounds per square inch (PSI) concrete with 6x6 - W1.4xW1.4

steel reinforcing mesh. We recommend an annual inspection of the sidewalks to identify

potential trip hazards. We suggest the Association grind down or mark these hazards

with orange safety paint prior to replacement and fund this ongoing activity through the

operating budget.


The Association should coordinate the concrete flatwork partial replacements on Line

Items 4.120 and 4.140 of Reserve Expenditures to maximize the given amount of concrete in a

single event. This will permit the use of a single contractor and likely achieve the most

economical unit price for the work. The times and costs of these replacements may vary.

However, the estimated expenditures detailed in Reserve Expenditures are sufficient to budget

appropriate reserves.

Fences, Chain Link – The Association maintains approximately 700 linear feet of chain

link fences surrounding the baseball diamond including the backstop. The fences and backstop

are original and in good condition.

Chain link fence surrounding baseball diamond

Baseball diamond backstop

Chain link fences have useful lives of up to 25 years. We recommend the Association

anticipate replacement by 2028. We suggest the Association consider the use of vinyl coated

fences at the time of replacement to increase longevity for subsequent replacements. We depict

this information on Line Item 4.220 of Reserve Expenditures.

Fences, Metal – The Association maintains approximately 2,020 linear feet of metal

fences at the following locations:


• 880 linear feet of decorative steel fences along Belfort Street • 520 linear feet of metal picket fences surrounding the pool • 620 linear feet of metal picket fences surrounding the splash pad park

development

The fences are original to the construction of the respective locations and are in good

condition. The protective finishes are likely original and are in fair overall condition. Our

inspection notes finish deterioration and isolated rust throughout the community.

Metal fence at West Belfort Street

Pool fence, note finish deterioration

Rust and finish deterioration at pool fence

Metal fence surrounding splash pad

Fences of this type have long useful lives of 25- to 35-years but are not maintenance free.

Periodic maintenance should include applications of protective paint finish to the metal surfaces

and partial replacement of deteriorated sections every six- to eight-years. Metal components at


grade and key structural connections are especially prone to failure if not thoroughly maintained.

Secure and rust free fasteners and connections will prevent premature deterioration.

Periodic applications of paint to the metal will help maximize the useful life. Preparation

of the metal before application of the paint finish is important. The paint contractor should

remove all soil, dirt, oil, grease and other foreign materials before application of the paint finish

to maximize its useful life. The contractor should also remove paint blisters and rust prior to the

paint finish application. We recommend the use of a power wire brush, scraper and/or sander as

effective means of removal. The Association should require the application of a primer on bare

metal. The primer for metal surfaces should include a rust inhibitor for added protection. We

recommend the Association refinish the fences in 2017 and every six years thereafter. Our cost

for paint finishes excludes quantities of fences in years where replacement is scheduled. We

anticipate replacement of the fences at the pool and splash pad by 2029 and replacement of the

fences along Belfort Street by 2041. We depict this information on Line Items 4.240 through

4.247 of Reserve Expenditures.

Fences, Wood – The Association maintains approximately 6,890 linear feet of solid

board wood fences throughout the community at the following locations:

• 590 linear feet along Belfort Street • 480 linear feet at the perimeters of the north pocket parks • 5,820 linear feet along Waterview Estates Trail

The fences at Belfort Street are in good condition at an age of less than one year. The

fences at the perimeters of the north pocket parks are likely original and are in fair to poor

condition. The fences at Waterview Estates Trail are original and in fair condition. These fences

exhibit wood rot, particularly at the baseboards. Our inspection also notes fence lean,

displacement and wood warp at the vertical boards.


Solid board wood fencing at Waterview Estates Trail

Recently replaced solid board wood fencing at West Belfort Street

Fence board warp and partial replacements

Fence lean

Fence board warp

Base board deterioration and displacement


Wood fences of this type have useful lives of 15- to 20-years. The Association should

anticipate periodic paint finishes every four- to six-years to maintain a consistent look

throughout the community. Along with these paint finishes, the Association should conduct

partial replacements due to the non-uniform nature of wood deterioration. We recommend the

Association budget for painting the fences in 2017 and every four years thereafter. Our cost for

paint finishes excludes quantities of fences in years where replacement is scheduled. Based on

condition, we suggest the Association plan for replacement of the north pocket park fences in

2017 and again by 2033. We recommend replacement of the fences at Waterview Estates Trail

by 2021 and again by 2037. We recommend replacement of the fences at Belfort Street by 2033.

We depict this information on Line Items 4.280 through 4.287 of Reserve Expenditures.

Irrigation System - An irrigation system comprised of approximately 175 zones waters

the lawn and landscaped areas throughout the community. The system is original and reported in

good condition. Management and the Board do not report any deficiencies. Irrigation systems

typically include the following components:

• Electronic controls (timer) • Impact rotors • Network of supply pipes • Pop-up heads • Pumps • Valves

Water pressure activates the lawn spray pop-up heads. Controllers operate the main

water flow valves. The exact amounts and locations of system components were not ascertained

due to the nature of the underground construction and the non-invasive nature of the inspection.

Management and the Board inform us the Association draws water from a well for the system.

The 5-horsepower (HP) well pump is original and reported in good condition. This pump has a

useful life of up to 20 years and we recommend replacement by 2023 and again by 2043. We


note this information on Line Item 4.410 of Reserve Expenditures. We recommend the

Association perform interim repairs to the pump using funds from the operating budget.

The system as a whole has a useful life of up to 40 years. The system network supply

pipes will dislodge as tree roots grow and soil conditions change. Waterview Estates should

anticipate interim and partial replacements of the system network supply pipes and other

components as normal maintenance to maximize the useful life of the irrigation system. The

Association should fund these ongoing seasonal repairs through the operating budget. In

addition, we recommend Waterview Estates budget for a complete replacement of the system

beginning by 2042 and concluding by 2046. We note this information on Line Item 4.420 of

Reserve Expenditures.

Landscape, Partial Replacements - The Association contains a large quantity of trees,

shrubbery and other landscape elements. Replacement of these elements is an ongoing need.

Many associations including Waterview Estates budget for these replacements as normal

maintenance, funded through the operating budget. However, the Association may also desire to

periodically update the appearance of the community through major additions or improvements

to the landscape funded from Reserves. Management and the Board inform us the Association

will expend approximately $60,000 in 2017 to add additional landscaping at the two new

community entrances. Following this near term installation of landscape, we recommend the

Association continue to fund these expenses with funds from the operating budget. We depict

this information on Line Item 4.500 of Reserve Expenditures.


Light Poles and Fixtures - The Association uses four metal light fixtures atop steel poles

to illuminate the parking area near the amenities. These elements are original, in good condition

and have useful lives of up to 30 years.

Metal light pole and fixture at amenity center

The Association should anticipate the need for replacement by 2033. We note this

information on Line Item 4.560 of Reserve Expenditures.

Playground Equipment - The Association maintains playground equipment throughout

the community. The playground equipment includes the following elements:

• Swing sets • Playsets • Surfaces, mulch • Borders, plastic and concrete • Benches • Trash receptacles

The playground equipment at the amenity center, north pocket parks and splash pad are

in good condition at approximate ages of nine years. The playground equipment at Jay Thrush

drive is in good condition at an age of five years. The playground equipment at Quill Rush

Drive is in good condition at an age of one year.


Playground equipment at amenity center

Playground equipment at north pocket park

Playground equipment at north pocket park

Playground equipment at splash pad park

Playground equipment at Jay Thrush Drive

Playground equipment at Quill Rush Drive


Safety is the major purpose for maintaining playground equipment. We recommend an

annual inspection of the playground equipment to identify and repair as normal maintenance

loose connections and fasteners or damaged elements. We suggest the Association learn more

about the specific requirements of playground equipment at PlaygroundSafety.org. We

recommend the use of a specialist for the design or replacement of the playground equipment

environment. Playground equipment of this type has a useful life of 15- to 20-years. We

recommend replacement of the playground equipment at the amenity center, north pocket parks

and splash pad by 2023 and again by 2039. We recommend replacement of the playground

equipment at Jay Thrush Drive by 2027 and again by 2043. We recommend replacement of the

playground equipment at Quill Rush Drive by 2031. We include this information on Line Items

4.660 through 4.662 of Reserve Expenditures.

Ponds, Aerator – The Association maintains a pond near the main entrance to the

community that utilizes a fountain style aerator. The use of small pumps, motors and aerators

circulates pond water and increases the amount of entrained oxygen in the water, increasing

water quality and reducing algae growths. The aerator is original and reported in good condition.

Fountain style pond aerator


Aerators have a useful life of 10- to 15-years. Based on age and condition, we

recommend the Association anticipate replacement by 2020 and every 12 years thereafter. Line

Item 4.700 of Reserve Expenditures notes our estimate of future costs and anticipated times of

replacements.

Signage, Entrance Monument - The Association maintains an entrance monument sign

at the intersection of Belfort Street and Waterview Estates Trail. The sign is in good condition at

an age of one year. The functional useful life of the sign is up to 30 years. Community signs

contribute to the overall aesthetic appearance of the property to owners and potential buyers.

Replacement of community signs is often predicated upon the desire to "update" the perceived

identity of the community rather than for utilitarian concerns. Therefore, the specific time for

replacement of the signs is discretionary. We recommend the Association plan to replace the

sign by 2045. We note this information on Line Item 4.810 of Reserve Expenditures.

Tennis Courts - Waterview Estates maintains 12,960 square feet of concrete comprising

two tennis courts. The components of the courts include the color coat, fences, light poles and

fixtures, and the playing surfaces.

Tennis courts overview

Color coat surface in fair condition


Light poles and fixtures

Chain link fence at perimeter

We comment on the respective quantities, conditions and times of replacements in the

following sections of this narrative.

Color Coat - The court color coat surfaces are in fair overall condition at an

unknown age. We note significant deterioration at the north end of the courts. We

recommend the Association apply a new color coat every four- to six-years to maximize

the useful life. Prior to the application of the color coat, the Association should require

the contractor to replace deteriorated concrete as needed. This deters water infiltration

and further deterioration of the concrete playing surface. We advise the Association to

perform crack repairs and apply a new color coat application in 2017 and every five years

thereafter except when replacement occurs. We include this information on Line Item


Fence - Approximately 480 linear feet of metal chain link fence encloses the

courts. The chain link fence is in good condition at an approximate age of 11 years.

Chain link fences of this type have a useful life of up to 25 years. We recommend the


Association anticipate replacement of the fence by 2027, concurrent with color coat

applications. We depict this information on Line Item 4.840 of Reserve Expenditures.

Light Poles and Fixtures - The Association maintains nine light poles and

fixtures to illuminate the courts. The metal poles and fixtures in good condition at an

approximate age of 11 years. Light poles and fixtures of this type have a useful life of up

to 30 years. We recommend the Association anticipate replacement by 2032, concurrent

color coat applications. We include this information on Line Item 4.850 of Reserve

Expenditures.

Surface - The court playing surfaces in good overall condition at an approximate

age of 11 years. Concrete tennis courts have useful lives of up to 40 years. In

consideration of the observed condition and to maintain a safe playing surface, we

recommend the Association anticipate replacement by 2042. We note this information on

Line Item 4.860 of Reserve Expenditures. We recommend replacement of the tennis

standards and wind screens from the operating budget on an as needed basis.

The times and costs of these replacements may vary. However, the estimated

expenditures detailed in Reserve Expenditures are sufficient to budget appropriate reserves.


Clubhouse Elements

Clubhouse, street side elevation

Clubhouse, parking area side elevation

Clubhouse, pool side elevation

Pool house

HVAC Equipment, Split System - The clubhouse heating, ventilating and air

conditioning (HVAC) equipment includes one split system comprised of one remote condensing

unit and one interior air handling unit. The split system is original and reported in good

operational condition. The useful life of residential size units is from 12- to 18-years. We

recommend the Association anticipate the replacement of this equipment by 2020 and again by

2035. We base our cost on Line Item 5.450 of Reserve Expenditures on a 13 seasonal energy

efficiency ratio (SEER) condensing unit as required by The Department of Energy since January

of 2006.


Interior Renovations - The clubhouse interior comprises finished area including a foyer,

office, rest rooms, kitchen and sitting area.

Clubhouse cabinets, countertops and appliances

Clubhouse sitting area

Clubhouse foyer

Clubhouse rest room

Interior components of the clubhouse include:

• Stained concrete floor coverings • Paint finishes on the walls and ceilings • Plumbing fixtures • Light fixtures including exit and emergency lights • Kitchen cabinets and countertops • Furnishings including sofas, tables and chairs • Various appliances including a refrigerator and microwave

The clubhouse interior elements are original and in good to fair condition. The useful

lives of these interior building elements vary. However, due to the interrelated nature of these


elements and the desire to achieve a uniform appearance, we recommend the Association

combine their replacements into coordinated interior renovations.

We recommend the Association anticipate a complete interior renovation of the

clubhouse every 25 years. The complete renovation should include replacement of all the

interior components listed above. Based on the age and visual condition of these interior

clubhouse elements, we recommend the Association budget for a coordinated complete interior

renovation by 2030. In addition to the complete renovation, Waterview Estates should also

anticipate partial interior renovations every 10- to 15-years. These partial renovations should

include the following:

• Application of paint finish to all walls and ceilings and application of stain to the concrete floors

• Replacement of the appliances and furnishings as necessary

Based on the reported age and visual condition of these interior clubhouse elements, we

recommend the Association budget for coordinated partial interior renovations by 2018 and

again by 2042. Line Items 5.500 and 5.510 of Reserve Expenditures note our estimates of future

costs and anticipated times of interior clubhouse renovations. We recommend interim

replacements of the furnishings and appliances as needed, funded through the operating budget.

Roof Assemblies, Metal - The Association maintains approximately 44 squares1 of

standing seam metal roofing at the clubhouse, pool house and splash pad park pavilion. Each

panel has two seams that stand up vertically and are crimped together to seal the joint and keep

weather elements from penetrating. The roof assemblies are original and in good to fair overall

condition. Our inspection notes isolated rust at the clubhouse roof.

1We quantify the roof area in squares where one square is equal to 100 square feet of surface area.


Roof rust at valley

Roof rust at standing seam panel

These types of roofs have a useful life of up to 30 years. Based on the age and condition

of the roof assemblies, we recommend Waterview Estates fund for replacement by 2033. We

note this information on Line Item 5.600 of Reserve Expenditures. We recommend replacement

with prefinished baked enamel sheet metal. Our cost includes replacement of aluminum gutters

and downspouts in conjunction with roof replacements.

Security System - Waterview Estates utilizes a security system for added security within

the clubhouse and other common areas throughout the community. The security system is

reported in good operational condition at an age of one year. As the system ages, service

interruptions will increase in frequency. We anticipate a useful life of up to 10 years for the

system. The Association should anticipate replacement of the security system by 2025 and every

10 years thereafter. We include this information on Line Item 5.700 of Reserve Expenditures.

The Association should anticipate interim replacements of a limited quantity of components as

normal maintenance to achieve a uniform useful life for the entire system.

Windows and Doors - The clubhouse windows and doors comprise approximately 380

square feet, are original and are in good condition. The useful life of windows and exterior doors


of this type and quality is up to 30 years. The useful life of the windows and doors is based on

the occurrence of water infiltration, thermal inefficiencies compared to present technology, type

of frame, availability of replacement parts and aesthetics. Based on these factors, we

recommend the Association anticipate replacement of these windows and doors by 2033. We

depict this information on Line Item 5.800 of Reserve Expenditures.

Pool Elements

Pool area overview

Pool area overview

Pool overview

Splash pad overview


Concrete Deck - A concrete deck surrounds the pool and comprises approximately 7,750

square feet. The deck is original in good condition. Management and the Board inform us the

deck was expanded and repaired in 2015. Our inspection notes isolated and minor deterioration.

Pool deck in good condition with isolated and minor deterioration

Control joints in good condition

Isolated pool deck crack

Section of pool deck recently added

The useful life of a concrete pool deck is up to 60 years. However, we recommend the

Association conduct inspections, partial replacements and repairs to the deck every 8- to 12-

years. Inadequate subsurface preparation, improper concrete mixtures, poor finishing

techniques, soil movement and water infiltration underneath the concrete deck can cause

significant settlement and cracks in the concrete. The pool deck should also be free of trip


hazards for the safety of residents and their guests. We recommend the Association budget for

the following by 2025 and every 10 years thereafter:

• Selective cut out and replacements of up to ten percent (10%) of concrete • Crack repairs as needed • Mortar joint repairs • Caulk replacement

The times, amounts and related costs of these repairs and replacements may vary.

However, we judge the amounts shown on Line Item 6.200 of Reserve Expenditures sufficient

to budget appropriate reserves.

Furniture - Associated furniture and fixtures around the pool include the following:

• Chairs • Lounges • Tables • Ladders and life safety equipment

These items are original and are in fair condition.

Lounges

Tables and chairs

Pool furniture has a useful life of up to 12 years. We recommend the Association budget

an allowance for replacement of the pool furniture and fixtures by 2018 and every 12 years

thereafter. The times and costs of these replacements may vary. However, we judge the

amounts shown on Line Item 6.500 of Reserve Expenditures sufficient to budget appropriate


reserves. We recommend interim re-strapping, refinishing, cushion replacements, reupholstering

and other repairs to the furniture as normal maintenance to maximize its useful life.

Mechanical Equipment - The pool mechanical equipment comprises the following:

• Controls • Filters • Interconnected pipe, fittings and valves • Pumps

Management and the Board inform us a significant portion of the pool mechanical

equipment was replaced in 2015 and all items are in good operational condition. Management

and the Board also inform us the chlorination system is leased.

Pool mechanical equipment

Pool mechanical equipment has a useful life of up to 15 years. Failure of the pool

mechanical equipment as a single event is unlikely. We recommend the Association anticipate

replacement of up to fifty percent (50%) of the pool mechanical equipment by 2021 and every

six years thereafter. We consider interim replacement of motors and minor repairs as normal

maintenance. We note this information on Line Item 6.600 of Reserve Expenditures.


Pool Finish, Plaster - The pool wall and floor surfaces have a plaster finish of 5,690

square feet based on the horizontal surface area. The finish is in good condition at an age of one

year. We note no visible deterioration of the finish.

Pool with plaster finish

Plaster and tile pool finish

This type of pool finish deteriorates with time and requires periodic maintenance and

replacement. We recommend the Association anticipate the need to replace the finish and

conduct related repairs every 8- to 12-years to maintain the integrity of the pool structure.

Removal and replacement provides the opportunity to inspect the pool structure and to allow for

partial repairs of the underlying concrete surfaces as needed. We recommend the Association

budget for the following by 2025 and every 10 years thereafter:

• Removal and replacement of the finish • Partial replacements of the scuppers and coping as needed • Replacement of tiles as needed • Replacement of joint sealants as needed • Concrete structure repairs as needed

We include this information on Line Item 6.800 of Reserve Expenditures.

Shade Structures – Waterview Estates maintains approximately 2,400 square feet of

shade structures at the pool and Jay Thrush Park. The shade structures are comprised of canvas


canopies and umbrellas with metal support frames. The shade structures are in good condition at

an age of one year.

Cantilevered shade structure

Umbrella style shade structure

Shade structures of this type have useful lives of 15- to 20-years with the benefit of

interim canvas replacements every six- to eight-years. Based on age and condition, we

recommend replacement of the canvas canopies by 2021 and every six years thereafter, except

when total replacement occurs by 2033. We depict this information on Line Items 6.880 and


Water Features and Slide - Waterview Estates maintains the metal water features and

spray nozzles at the splash pad and pool in addition to maintaining a composite water slide and

platform at the pool. The water features and spray nozzles at the splash pad and pool are original

and in good condition. Management and the Board inform us the Association refinished these

components including a color coat application to the splash pad concrete surface in 2015. The

water slide and platform is in good condition at an age of one year.


Water features at splash pad

Spray nozzles at splash pad

Water features at pool

Water features at pool

Water slide and platforms

Water slide


Safety is the major purpose of maintaining these elements. Therefore, these elements

have a useful life of 15- to 20-years. Additionally, these components require refinishing and

repairs every six- to eight-years to maximize this useful life. We recommend the Association

perform the next refinishing application and repair by 2021 and every six years thereafter, except

when complete replacement of the water features occurs. We recommend the Association

budget for replacement of the water features by 2027 and again by 2045. We recommend the

Association budget for replacement of the water slide by 2035. We depict this information on

Line Items 6.970 through 6.990 of Reserve Expenditures.

Reserve Study Update

An ongoing review by the Board and an Update of this Reserve Study in two- to three-

years are necessary to ensure an equitable funding plan since a Reserve Study is a snapshot in

time. Many variables change after the study is conducted that may result in significant

overfunding or underfunding the reserve account. Variables that may affect the

Reserve Funding Plan include, but are not limited to:

• Deferred or accelerated capital projects based on Board discretion • Changes in the interest rates on reserve investments • Changes in the local construction inflation rate • Additions and deletions to the Reserve Component Inventory • The presence or absence of maintenance programs • Unusually mild or extreme weather conditions • Technological advancements

Periodic updates incorporate these variable changes since the last Reserve Study or

Update.

The Association can expense the fee for an Update with site visit from the reserve

account. This fee is included in the Reserve Funding Plan. We base this budgetary amount on

updating the same property components and quantities of this Reserve Study report. Budgeting


for an Update demonstrates the Board's objective to continue fulfilling its fiduciary responsibility

to maintain the commonly owned property and to fund reserves appropriately.

Page 5.1 - Methodology

5. METHODOLOGY

Reserves for replacement are the amounts of money required for future expenditures to repair or

replace Reserve Components that wear out before the entire facility or project wears out. Reserving funds

for future repair or replacement of the Reserve Components is also one of the most reliable ways of

protecting the value of the property’s infrastructure and marketability.

Waterview Estates can fund capital repairs and replacements in any combination of the following:

1. Increases in the operating budget during years when the shortages occur 2. Loans using borrowed capital for major replacement projects 3. Level monthly reserve assessments annually adjusted upward for inflation to increase

reserves to fund the expected major future expenditures 4. Special assessments

We do not advocate special assessments or loans unless near term circumstances dictate

otherwise. Although loans provide a gradual method of funding a replacement, the costs are higher than

if the Association were to accumulate reserves ahead of the actual replacement. Interest earnings on

reserves also accumulate in this process of saving or reserving for future replacements, thereby defraying

the amount of gradual reserve collections. We advocate the third method of Level Monthly Reserve

Assessments with relatively minor annual adjustments. The method ensures that Homeowners pay their

"fair share" of the weathering and aging of the commonly owned property each year. Level reserve

assessments preserve the property and enhance the resale value of the homes.

This Reserve Study is in compliance with and exceeds the National standards1 set forth by the

Community Associations Institute (CAI) and the Association of Professional Reserve Analysts (APRA)

fulfilling the requirements of a “Full Reserve Study.” These standards require a Reserve Component to

have a “predictable remaining Useful Life.” Estimating Remaining Useful Lives and Reserve

Expenditures beyond 30 years is often indeterminate. Long-Lived Property Elements are necessarily

excluded from this analysis. We considered the following factors in our analysis:

1 Identified in the APRA “Standards - Terms and Definitions” and the CAI "Terms and Definitions".


Information Furnished by the Association 2016 unaudited Cash Status of the Reserve Fund 189,618

2016 Budgeted Reserve Contribution 49,250

Anticipated Interest on Reserve Fund 2,410

Less Anticipated Reserve Expenditures 0

Projected 2016 Year-End Reserve Balance $241,278

The Cash Flow Method to compute, project and illustrate the 30-year Reserve Funding Plan

Local2 costs of material, equipment and labor

Current and future costs of replacement for the Reserve Components

Costs of demolition as part of the cost of replacement

Local economic conditions and a historical perspective to arrive at our estimate of long term future inflation for construction costs in Richmond, Texas at an annual inflation rate of 3.0%. Isolated or regional markets of greater construction (development) activity may experience slightly greater rates of inflation for both construction materials and labor.

The past and current maintenance practices of Waterview Estates and their effects on remaining useful lives

The Funding Plan excludes necessary operating budget expenditures. It is our understanding that future operating budgets will provide for the ongoing normal maintenance of Reserve Components.

The anticipated effects of appreciation of the reserves over time in accord with an anticipated future return or yield on investment of your cash equivalent assets at an annual rate of 1.35% (We did not consider the costs, if any, of Federal and State Taxes on income derived from interest and/or dividend income).

Interest rates on reserves are steady or increasing in concert with the certificates of deposit and

money market rates. Slight increases exist in the savings rates of one, two or three-year CDs. Without

significant differences in these savings rates, shorter term investments are the choice of many investors.

We recommend consultation with a professional investment adviser before investing reserves to

determine an appropriate investment strategy to maximize a safe return on reserve savings. The following

2 See Credentials for addition information on our use of published sources of cost data.


table summarizes rates of inflation and key rates for government securities, generally considered as safe

investment alternatives.

Interest Rate and Inflation Data Average or Last Actual = (A) 2014:1 (A) 2014:2 (A) 2014:3 (A) 2014:4 (A) 2015:1 (A) 2015:2 (A) 2015:3 (A) 2015:4 (E)

1-Year Treasury Bill 0.13% 0.15% 0.13% 0.01% 0.25% 0.27% 0.30% 0.50%

10-Year Treasury Note 2.80% 2.65% 2.40% 2.25% 1.90% 2.50% 2.70% 2.28%

30-Year Treasury Bond 3.90% 3.50% 3.35% 3.00% 2.55% 3.20% 3.40% 3.05%

Consumer Price Index (annualized rate) 1.50% 2.00% 2.40% 2.60% 0.00% 0.00% 0.00% 0.00%-0.3%

Savings Rates Results RANGE as found in 0.05 to 1.10% Money Market Savings 0.65 to 1.53% for 2-Year Certificate of Deposit http://www.bankrate.com 0.65 to 1.35% 1-Year Certificate of Deposit 0.9 to 1.35% for 3-Year Certificate of Deposit

1.35%

3.0% 11/13/2015

2014 2015

Est. Near Term Local Inflation Rate for Future Capital Expenditures . . . . . . . .

Estimated Near Term Yield Rate for Reserve Savings . . . . . . . . . . . . . . . . . . . .

Residential Construction Producer Price Index-Inflation Rate, Bureau of Labor Statistics (Year over Year Oct. 2015 Showing no meaningful change )

Updates to this Reserve Study will continue to monitor historical facts and trends concerning the

external market conditions.

Page 6.1 - Definitions

6. DEFINITIONS

Definitions are derived from the standards set forth by the Community Associations Institute (CAI) representing America's 305,000 condominium and homeowners associations and cooperatives, and the Association of Professional Reserve Analysts, setting the standards of care for reserve study practitioners

Cash Flow Method - A method of calculating Reserve Contributions where contributions to the reserve fund are designed to offset the variable annual expenditures from the reserve fund. Different Reserve Funding Plans are tested against the anticipated schedule of reserve expenses until the desired funding goal is achieved.

Component Method - A method of developing a Reserve Funding Plan with the total contribution is based on the sum of the contributions for individual components.

Current Cost of Replacement - That amount required today derived from the quantity of a Reserve Component and its unit cost to replace or repair a Reserve Component using the most current technology and construction materials, duplicating the productive utility of the existing property at current local market prices for materials, labor and manufactured equipment, contractors' overhead, profit and fees, but without provisions for building permits, overtime, bonuses for labor or premiums for material and equipment. We include removal and disposal costs where applicable.

Fully Funded Balance - The Reserve balance that is in direct proportion to the fraction of life "used up" of the current Repair or Replacement cost similar to Total Accrued Depreciation.

Funding Goal (Threshold) - The stated purpose of this Reserve Study is to determine the adequate, not excessive, minimal threshold reserve balances.

Future Cost of Replacement - Reserve Expenditure derived from the inflated current cost of replacement or current cost of replacement as defined above, with consideration given to the effects of inflation on local market rates for materials, labor and equipment.

Long-Lived Property Component - Property component of Waterview Estates responsibility not likely to require capital repair or replacement during the next 30 years with an unpredictable remaining Useful Life beyond the next 30 years.

Percent Funded - The ratio, at a particular point of time (typically the beginning of the Fiscal Year), of the actual (or projected) Reserve Balance to the Fully Funded Balance, expressed as a percentage.

Remaining Useful Life - The estimated remaining functional or useful time in years of a Reserve Component based on its age, condition and maintenance.

Reserve Component - Property elements with: 1) Waterview Estates responsibility; 2) limited Useful Life expectancies; 3) predictable Remaining Useful Life expectancies; and 4) a replacement cost above a minimum threshold.

Reserve Component Inventory - Line Items in Reserve Expenditures that identify a Reserve Component.

Reserve Contribution - An amount of money set aside or Reserve Assessment contributed to a Reserve Fund for future Reserve Expenditures to repair or replace Reserve Components.

Reserve Expenditure - Future Cost of Replacement of a Reserve Component.

Reserve Fund Status - The accumulated amount of reserves in dollars at a given point in time, i.e., at year end.

Reserve Funding Plan - The portion of the Reserve Study identifying the Cash Flow Analysis and containing the recommended Reserve Contributions and projected annual expenditures, interest earned and reserve balances.

Reserve Study - A budget planning tool that identifies the current status of the reserve fund and a stable and equitable Funding Plan to offset the anticipated future major common area expenditures.

Useful Life - The anticipated total time in years that a Reserve Component is expected to serve its intended function in its present application or installation.

Page 7.1 - Professional Service Conditions

7. PROFESSIONAL SERVICE CONDITIONS

Our Services - Reserve Advisors, Inc. will perform its services as an independent contractor in accordance with our professional practice standards. Our compensation is not contingent upon our conclusions.

Our inspection and analysis of the subject property is limited to visual observations and is

noninvasive. We will inspect sloped roofs from the ground. We will inspect flat roofs where safe access (stairs or ladder permanently attached to the structure) is available. The report is based upon a “snapshot in time” at the moment of our observation. Conditions can change between the time of inspection and the issuance of the report. Reserve Advisors does not investigate, nor assume any responsibility for any existence or impact of any hazardous materials, structural, latent or hidden defects which may or may not be present on or within the property. Our opinions of estimated costs and remaining useful lives are not a guarantee of the actual costs of replacement, a warranty of the common elements or other property elements, or a guarantee of remaining useful lives.

We assume, without independent verification, the accuracy of all data provided to us. You agree to

indemnify and hold us harmless against and from any and all losses, claims, actions, damages, expenses or liabilities, including reasonable attorneys' fees, to which we may become subject in connection with this engagement, because of any false, misleading or incomplete information which we have relied upon as supplied by you or others under your direction, or which may result from any improper use or reliance on the report by you or third parties under your control or direction. Your obligation for indemnification and reimbursement shall extend to any controlling person of Reserve Advisors, Inc., including any director, officer, employee, affiliate, or agent. Liability of Reserve Advisors, Inc. and its employees, affiliates, and agents for errors and omissions, if any, in this work is limited to the amount of its compensation for the work performed in this engagement.

Report - Reserve Advisors, Inc. will complete the services in accordance with the Proposal. The

Report represents a valid opinion of our findings and recommendations and is deemed complete. However, we will consider any additional information made available to us in the interest of promptly issuing a Revised Report if changes are requested within six months of receiving the Report. We retain the right to withhold a Revised Report if payment for services is not rendered in a timely manner. All files, work papers or documents developed by us during the course of the engagement remains our property.

Your Obligations - You agree to provide us access to the subject property during our on-site visual

inspection and tour. You will provide to us to the best of your ability and if reasonably available, historical and budgetary information, the governing documents, and other information that we request and deem necessary to complete our Study. You agree to pay our actual attorneys’ fees and any other costs incurred in the event we have to initiate litigation to collect on any unpaid balance for our services.

Use of Our Report and Your Name - Use of this Report is limited to only the purpose stated

herein. Any use or reliance for any other purpose, by you or third parties, is invalid. Our Reserve Study Report in whole or part is not and cannot be used as a design specification, design engineering services or an appraisal. You may show our report in its entirety to those third parties who need to review the information contained herein. The Client and other third parties viewing this report should not reference our name or our report, in whole or in part, in any document prepared and/or distributed to third parties without our written consent. This report contains intellectual property developed by Reserve Advisors, Inc. specific to this engagement and cannot be reproduced or distributed to those who conduct reserve studies without the written consent of Reserve Advisors, Inc.

Page 7.2 - Professional Service Conditions

We reserve the right to include our client's name in our client lists, but we will maintain the confidentiality of all conversations, documents provided to us, and the contents of our reports, subject to legal or administrative process or proceedings. These conditions can only be modified by written documents executed by both parties.

Payment Terms, Due Dates and Interest Charges - The retainer payment is due upon

authorization and prior to shipment of the report. The final payment of the fee is due immediately upon receipt of the Report. Subsequent changes to the report can be made for up to six months from the initial report date. Any outstanding balance after 30 days of the invoice date is subject to an interest charge of 1.5% per month. Any litigation necessary to collect an unpaid balance shall be venued in Milwaukee County Circuit Court in the State of Wisconsin.

CONDITIONS OF OUR SERVICE ASSUMPTIONS To the best of our knowledge, all data set forth in this report are true and accurate. Although

gathered from reliable sources, we make no guarantee nor assume liability for the accuracy of any data, opinions, or estimates identified as furnished by others that we used in formulating this analysis.

We did not make any soil analysis or geological study with this report; nor were any water, oil, gas,

coal, or other subsurface mineral and use rights or conditions investigated. Substances such as asbestos, urea-formaldehyde foam insulation, other chemicals, toxic wastes,

environmental mold or other potentially hazardous materials could, if present, adversely affect the validity of this study. Unless otherwise stated in this report, the existence of hazardous substance, that may or may not be present on or in the property, was not considered. Our opinions are predicated on the assumption that there are no hazardous materials on or in the property. We assume no responsibility for any such conditions. We are not qualified to detect such substances, quantify the impact, or develop the remedial cost.

We have made a visual inspection of the property and noted visible physical defects, if any, in our

report. Our inspection and analysis was made by employees generally familiar with real estate and building construction; however, we did not do any invasive testing. Accordingly, we do not opine on, nor are we responsible for, the structural integrity of the property including its conformity to specific governmental code requirements, such as fire, building and safety, earthquake, and occupancy, or any physical defects that were not readily apparent during the inspection.

Our opinions of the remaining useful lives of the property elements do not represent a guarantee or

warranty of performance of the products, materials and workmanship.

Page 8.1 - Credentials

8. CREDENTIALS

HISTORY AND DEPTH OF SERVICE Founded in 1991, Reserve Advisors, Inc. is the leading provider of reserve studies, insurance

appraisals, developer turnover transition studies, expert witness services, and other engineering consulting services. Clients include community associations, resort properties, hotels, clubs, non-profit organizations, apartment building owners, religious and educational institutions, and office/commercial building owners in 48 states, Canada and throughout the world.

The architectural engineering consulting firm was formed to take a leadership role in helping fiduciaries, boards, and property managers manage their property like a business with a long range master plan known as a Reserve Study.

Reserve Advisors employs the largest staff of Reserve Specialists with bachelor’s degrees in engineering dedicated to Reserve Study services. Our principals are founders of Community Associations Institute's (CAI) Reserve Committee that developed national standards for reserve study providers. One of our principals is a Past President of the Association of Professional Reserve Analysts (APRA). Our vast experience with a variety of building types and ages, on-site examination and historical analyses are keys to determining accurate remaining useful life estimates of building components.

No Conflict of Interest - As consulting specialists, our independent opinion eliminates any real or perceived conflict of interest because we do not conduct or manage capital projects.

TOTAL STAFF INVOLVEMENT Several staff members participate in each assignment. The responsible advisor involves the staff

through a Team Review, exclusive to Reserve Advisors, and by utilizing the experience of other staff members, each of whom has served hundreds of clients. We conduct Team Reviews, an internal quality assurance review of each assignment, including: the inspection; building component costing; lifing; and technical report phases of the assignment. Each Team Review requires the attendance of several engineers, a Review Coordinator, Director of Quality Assurance and other participatory peers. Due to our extensive experience with building components, we do not have a need to utilize subcontractors.

OUR GOAL To help our clients fulfill their fiduciary responsibilities to maintain property in good condition. VAST EXPERIENCE WITH A VARIETY OF BUILDINGS Reserve Advisors has conducted reserve studies for a multitude of different communities and

building types. We've analyzed thousands of buildings, from as small as a 3,500-square foot day care center to the 2,600,000-square foot 98-story Trump International Hotel and Tower in Chicago. We also routinely inspect buildings with various types of mechanical systems such as simple electric heat, to complex systems with air handlers, chillers, boilers, elevators, and life safety and security systems.

We're familiar with all types of building exteriors as well. Our well versed staff regularly identifies optimal repair and replacement solutions for such building exterior surfaces such as adobe, brick, stone, concrete, stucco, EIFS, wood products, stained glass and aluminum siding, and window wall systems.

OLD TO NEW Reserve Advisors experience includes ornate and vintage buildings as well as modern structures.

Our specialists are no strangers to older buildings. We're accustomed to addressing the unique challenges posed by buildings that date to the 1800's. We recognize and consider the methods of construction employed into our analysis. We recommend appropriate replacement programs that apply cost effective technologies while maintaining a building's character and appeal.


QUALIFICATIONS THEODORE J. SALGADO

Principal Owner CURRENT CLIENT SERVICES Theodore J. Salgado is a co-founder of Reserve Advisors, Inc., which is dedicated to serving community associations, city and country clubs, religious organizations, educational facilities, and public and private entities throughout the United States. He is responsible for the production, management, review, and quality assurance of all reserve studies, property inspection services and consulting services for a nationwide portfolio of more than 6,000 clients. Under his direction, the firm conducts reserve study services for community associations, apartment complexes, churches, hotels, resorts, office towers and vintage architecturally ornate buildings. PRIOR RELEVANT EXPERIENCE Before founding Reserve Advisors, Inc. with John P. Poehlmann in 1991, Mr. Salgado, a professional engineer registered in the State of Wisconsin, served clients for over 15 years through American Appraisal Associates, the world's largest full service valuation firm. Mr. Salgado conducted facilities analyses of hospitals, steel mills and various other large manufacturing and petrochemical facilities and casinos. He has served clients throughout the United States and in foreign countries, and frequently acted as project manager on complex valuation, and federal and state tax planning assignments. His valuation studies led to negotiated settlements on property tax disputes between municipalities and property owners. Mr. Salgado has authored articles on the topic of reserve studies and facilities maintenance. He also co-authored Reserves, an educational videotape produced by Reserve Advisors on the subject of Reserve Studies and maintaining appropriate reserves. Mr. Salgado has also written in-house computer applications manuals and taught techniques relating to valuation studies. EXPERT WITNESS Mr. Salgado has testified successfully before the Butler County Board of Tax Revisions in Ohio. His depositions in pretrial discovery proceedings relating to reserve studies of Crestview Estates Condominium Association in Wauconda, Illinois, Rivers Point Row Property Owners Association, Inc. in Charleston, South Carolina and the North Shore Club Associations in South Bend, Indiana have successfully assisted the parties in arriving at out of court settlements. EDUCATION - Milwaukee School of Engineering - B.S. Architectural Engineering PROFESSIONAL AFFILIATIONS/DESIGNATIONS American Association of Cost Engineers - Past President, Wisconsin Section Association of Construction Inspectors - Certified Construction Inspector Association of Professional Reserve Analysts - Past President & Professional Reserve Analyst (PRA) Community Associations Institute - Member and Volunteer Leader of multiple chapters Concordia Seminary, St. Louis - Member, National Steering Committee Milwaukee School of Engineering - Member, Corporation Board Professional Engineer, Wisconsin (1982) and North Carolina (2014)

Ted continually maintains his professional skills through American Society of Civil Engineers, ASHRAE, Association of Construction Inspectors, and continuing education to maintain his professional engineer licenses.


JOHN P. POEHLMANN, RS Principal

John P. Poehlmann is a co-founder of Reserve Advisors, Inc. He is

responsible for the finance, accounting, marketing, and overall administration of Reserve Advisors, Inc. He also regularly participates in internal Quality Control Team Reviews of Reserve Study reports.

Mr. Poehlmann directs corporate marketing, including business development, advertising, press releases, conference and trade show exhibiting, and electronic marketing campaigns. He frequently speaks throughout the country at seminars and workshops on the benefits of future planning and budgeting for capital repairs and replacements of building components and other assets.

PRIOR RELEVANT EXPERIENCE Mr. Poehlmann served on the national Board of Trustees of Community Associations Institute.

An international organization, Community Associations Institute (CAI) is a nonprofit 501(c)(3) trade association created in 1973 to provide education and resources to America’s 335,000 residential condominium, cooperative and homeowner associations and related professionals and service providers.

He is a founding member of the Institute's Reserve Committee. The Reserve Committee developed national standards and the Reserve Specialist (RS) Designation Program for Reserve Study providers. Mr. Poehlmann has authored numerous articles on the topic of Reserve Studies, including Reserve Studies for the First Time Buyer, Minimizing Board Liability, Sound Association Planning Parallels Business Concepts, and Why Have a Professional Reserve Study. He is also a contributing author in Condo/HOA Primer, a book published for the purpose of sharing a wide background of industry knowledge to help boards in making informed decisions about their communities.

INDUSTRY SERVICE AWARDS CAI Wisconsin Chapter Award CAI National Rising Star Award CAI Michigan Chapter Award

EDUCATION

University of Wisconsin-Milwaukee - Master of Science Management University of Wisconsin - Bachelor of Business Administration

PROFESSIONAL AFFILIATIONS Community Associations Institute (CAI) - Founding member of Reserve Committee; former

member of National Board of Trustees; Reserve Specialist (RS) designation; Member of multiple chapters

Association of Condominium, Townhouse, & Homeowners Associations (ACTHA) – member


ALAN M. EBERT, P.E., PRA, RS Director of Quality Assurance

CURRENT CLIENT SERVICES Alan M. Ebert, a Professional Engineer, is Director of Quality Assurance for Reserve Advisors. Mr. Ebert is responsible for the management, review and quality assurance of reserve studies. In this role, he assumes the responsibility of stringent report review analysis to assure report accuracy and the best solution for Reserve Advisors’ clients. Mr. Ebert has been involved with hundreds of Reserve Study assignments. The following is a partial list of clients served by Alan Ebert demonstrating his breadth of experiential knowledge of community associations in construction and related buildings systems. Brownsville Winter Haven Located in Brownsville, Texas, this unique homeowners association contains 525

units. The Association maintains three pools and pool houses, a community and management office, landscape and maintenance equipment, and nine irrigation canals with associated infrastructure.

Rosemont Condominiums This unique condominium is located in Alexandria, Virginia and dates to the 1940's. The two mid-rise buildings utilize decorative stone and brick masonry. The development features common interior spaces, multi-level wood balconies and common asphalt parking areas.

Stillwater Homeowners Association Located in Naperville, Illinois, Stillwater Homeowners Association maintains four tennis courts, an Olympic sized pool and an upscale ballroom with commercial-grade kitchen. The community also maintains three storm water retention ponds and a detention basin.

Birchfield Community Services Association This extensive Association comprises seven separate parcels which include 505 townhome and single family homes. This Community Services Association is located in Mt. Laurel, New Jersey. Three lakes, a pool, a clubhouse and management office, wood carports, aluminum siding, and asphalt shingle roofs are a few of the elements maintained by the Association.

Oakridge Manor Condominium Association Located in Londonderry, New Hampshire, this Association includes 104 units at 13 buildings. In addition to extensive roads and parking areas, the Association maintains a large septic system and significant concrete retaining walls.

Memorial Lofts Homeowners Association This upscale high rise is located in Houston, Texas. The 20 luxury units include large balconies and decorative interior hallways. The 10-story building utilizes a painted stucco facade and TPO roof, while an on-grade garage serves residents and guests.

PRIOR RELEVANT EXPERIENCE Mr. Ebert earned his Bachelor of Science degree in Geological Engineering from the University of Wisconsin-Madison. His relevant course work includes foundations, retaining walls, and slope stability. Before joining Reserve Advisors, Mr. Ebert was an oilfield engineer and tested and evaluated hundreds of oil and gas wells throughout North America.

EDUCATION University of Wisconsin-Madison - B.S. Geological Engineering

PROFESSIONAL AFFILIATIONS/DESIGNATIONS Professional Engineering License - Wisconsin 2012 Reserve Specialist (RS) - Community Associations Institute Professional Reserve Analyst (PRA) - Association of Professional Reserve Analysts


NICOLE L. LOWERY, PRA, RS Associate Director of Quality Assurance

CURRENT CLIENT SERVICES Nicole L. Lowery, a Civil Engineer, is an Associate Director of Quality Assurance for Reserve Advisors. Ms. Lowery is responsible for the management, review and quality assurance of reserve studies. In this role, she assumes the responsibility of stringent report review analysis to assure report accuracy and the best solution for Reserve Advisors’ clients. Ms. Lowery has been involved with hundreds of Reserve Study assignments. The following is a partial list of clients served by Nicole Lowery demonstrating her breadth of experiential knowledge of community associations in construction and related buildings systems.

Amelia Surf & Racquet Club This oceanfront condominium community comprises 156 units in three mid rise buildings. This Fernandina Beach, Florida development contains amenities such as clay tennis courts, two pools and boardwalks.

Ten Museum Park This boutique, luxury 50-story high rise building in downtown Miami, Florida consists of 200 condominium units. The amenities comprise six pools including resistance and plunge pools, a full-service spa and a state-of-the-art fitness center. The property also contains a multi-level parking garage.

3 Chisolm Street Homeowners Association This historic Charleston, South Carolina community was constructed in 1929 and 1960 and comprises brick and stucco construction with asphalt shingle and modified bitumen roofs. The unique buildings were originally the Murray Vocational School. The buildings were transformed in 2002 to 27 high-end condominiums. The property includes a courtyard and covered parking garage.

Lakes of Pine Run Condominium Association This condominium community comprises 112 units in 41 buildings of stucco construction with asphalt shingle roofs. Located in Ormond Beach, Florida, it has a domestic water treatment plant and wastewater treatment plant for the residents of the property.

Rivertowne on the Wando Homeowners Association This exclusive river front community is located on the Wando River in Mount Pleasant, South Carolina. This unique Association includes several private docks along the Wando River, a pool and tennis courts for use by its residents.

Biltmore Estates Homeowners Association This private gated community is located in Miramar, Florida, just northwest of Miami, Florida and consists of 128 single family homes. The lake front property maintains a pool, a pool house and private streets.

Bellavista at Miromar Lakes Condominium Association Located in the residential waterfront resort community of Miromar Lakes Beach & Golf Club in Fort Myers, Florida, this property comprises 60 units in 15 buildings. Amenities include a clubhouse and a pool.

PRIOR RELEVANT EXPERIENCE Before joining Reserve Advisors, Ms. Lowery was a project manager with Kipcon in New Brunswick, New Jersey and the Washington, D.C. Metro area for eight years, where she was responsible for preparing reserve studies and transition studies for community associations. Ms. Lowery successfully completed the bachelors program in Civil Engineering from West Virginia University in Morgantown, West Virginia.

EDUCATION West Virginia University - B.S. Civil Engineering

PROFESSIONAL AFFILIATIONS / DESIGNATIONS Reserve Specialist (RS) - Community Associations Institute Professional Reserves Analyst (PRA) - Association of Professional Reserve Analysts


TIMOTHY J. MATTHIESEN, RS Responsible Advisor

CURRENT CLIENT SERVICES Timothy J. Matthiesen, a Civil Engineer, is an Advisor for Reserve Advisors, Inc., which is dedicated to serving community associations, religious organizations, educational facilities, and public and private entities throughout the United States. Mr. Matthiesen is responsible for the inspection and analysis of the property’s current condition, recommending engineering solutions to prolong the lives of building components, forecasting capital expenditures for the repair and/or replacement of the property components, and technical report preparation on assignments. He is responsible for conducting Life Cycle Cost Analysis and Capital Replacement Forecast Services on townhomes, homeowners associations and planned unit developments.

The following is a partial list of clients served by Mr. Matthiesen demonstrating his breadth of experiential knowledge of community associations in construction and related buildings systems.

The Mercer Residential tower that rises 30 stories over the Galleria neighborhood west of downtown Houston.

Craig Ranch Community Association Nationally acclaimed master-planned community in North Texas spread across 400 acres that provides its residents with an unrivaled active community lifestyle.

Four Seasons Resorts Colorado State of the art 45-story high rise hotel and condominium in downtown Denver and ski lodge destination resort in Vail.

Riverstone Homeowners Association Developing community outside of Houston comprised of over 3,000 homes. The development includes private gated sections, several lakes, water parks and miles of perimeter walls.

Insulators & Allied Workers Local No. 14 Headquarters of the insulators and allied workers union for the Philadelphia area that houses its offices, a ballroom and an educational center.

Montgomery Plaza Constructed in 1927 as a regional retail and mail order warehouse for the Montgomery Ward company, this art-deco style high rise now comprises a shopping mall and luxury condominium development in Fort Worth. Some of its many features include an infinity pool, private movie theater and large exercise studios.

Steiner Ranch Homeowners Association One of the largest master-planned communities in Central Texas, this community features multiple pool and park developments overlooking Lake Austin and the surrounding hills.

Glenhaven Lakes Club A homeowners association of over 1,000 homes set in the mountains north of Seattle. The community is responsible for its extensive private water system and maintenance equipment.

The Broadway, San Antonio This luxury condominium high-rise near downtown features balconies with stunning views of the city and an elevated pool deck atop a parking structure.

Alpha Delta Pi Sorority House Frank Lloyd Wright inspired prairie style house on the campus of the University of Arizona that maintains residences for over sixty students and a commercial kitchen.

PRIOR RELEVANT EXPERIENCE

Before joining Reserve Advisors, Inc., Mr. Matthiesen was working with a consulting firm to assess school facility capabilities in southeastern Wisconsin. He was responsible for the inspection and condition assessment of school facilities and his day to day duties included conducting on-site meetings with school personnel, completing technical inspections and creating a database of photographs and building condition information.

Mr. Matthiesen also worked for a local county parks department near his hometown as a Civil Engineer. He was responsible for the design of park facilities including roadways and parking lots, picnic shelters and recreational trails along with the inspection of current facilities including historic structures maintained by the County.

EDUCATION

Marquette University - B.S. Civil Engineering PROFESSIONAL AFFILIATIONS

Reserve Specialist (RS) - Community Associations Institute


SARAH M. GIRLS, E.I.T., RS Review Coordinator

CURRENT CLIENT SERVICES Sarah M. Girls, a Civil Engineer, is an Advisor for Reserve Advisors, Inc. Ms. Girls is responsible for the inspection and analysis of the condition of clients' properties, and recommending engineering solutions to prolong the lives of the components. She also forecasts capital expenditures for the repair and/or replacement of the property components and prepares technical reports on assignments. She is responsible for conducting Life Cycle Cost Analysis and Capital Replacement Forecast services on townhomes, homeowners associations, planned unit developments and recreational associations. The following is a partial list of clients served by Sarah Girls demonstrating her breadth of experiential knowledge of community associations in construction and related buildings systems.

Brightwater Homeowner Association Located in Missouri City, Texas, this lively planned unit development

consists of 795 single family homes surrounding a picturesque lake. The Association contains a clubhouse equipped with indoor entertainment amenities. In addition to the clubhouse the development also features an outdoor pool and tennis courts for recreational activities.

Lismore Village Homeowners' Association Located in Greer, South Carolina, this quaint community comprises 76 townhomes. The buildings feature brick masonry, vinyl siding and asphalt shingle roofs. The development contains asphalt pavement, a gazebo, perimeter fences and concrete flatwork.

Pecan Park Garden Estate Condominium This attractive gated community in Austin, Texas consists of 146 units with a relaxing pool. Located throughout the property are perimeter walls, private drives and an irrigation system.

The Villages of Berry Creek Situated in Georgetown, Texas, this inviting community is comprised of 241 homes. Homeowners can enjoy two pools, a large deck and a playground that provide enough recreational space for entertaining. The development also includes perimeter fences and detention ponds.

Maple Leaf 20 Condominium Association A townhome style condominium development of 160 units in 20 buildings located in Greenfield, Wisconsin. These buildings were constructed in the mid 2000's and comprise asphalt shingle roofs, vinyl siding and masonry walls. The development contains asphalt pavement, wood fences and concrete flatwork.

Emerald Pointe Condominium Association This quaint community is located in Raleigh, North Carolina and consists of 51 townhomes in 14 buildings. The Association maintains asphalt shingle roofs, wood siding and decks, concrete flatwork and retaining walls.

PRIOR RELEVANT EXPERIENCE

Before joining Reserve Advisors, Inc., Ms. Girls attended Valparaiso University in Valparaiso, Indiana where she attained her Bachelor of Science degree in Civil Engineering. During her time at Valparaiso University, Ms. Girls lead her senior design group to develop a bypass around the City of Delphi, Indiana. This project also included the design of a bridge and mechanically stabilized earth walls. Ms. Girls also worked for Hagerman Inc. as an intern project engineer. She was responsible for overseeing and inspecting the construction of Valparaiso University's new Welcome Center.

EDUCATION

Valparaiso University –B.S. Civil Engineering

PROFESSIONAL AFFILIATIONS Engineer In Training (E.I.T.) Registration Reserve Specialist (RS) -Community Associations Institute


RESOURCES

Reserve Advisors, Inc. utilizes numerous resources of national and local data to conduct its Professional Services. A concise list of several of these resources follows: Association of Construction Inspectors, (ACI) the largest professional organization for those involved in construction inspection and construction project management. ACI is also the leading association providing standards, guidelines, regulations, education, training, and professional recognition in a field that has quickly become important procedure for both residential and commercial construction, found on the web at www.iami.org. Several advisors and a Principal of Reserve Advisors, Inc. hold Senior Memberships with ACI. American Society of Heating, Refrigerating and Air-Conditioning Engineers, Inc., (ASHRAE) the American Society of Heating, Refrigerating and Air-Conditioning Engineers, Inc., devoted to the arts and sciences of heating, ventilation, air conditioning and refrigeration; recognized as the foremost, authoritative, timely and responsive source of technical and educational information, standards and guidelines, found on the web at www.ashrae.org. Reserve Advisors, Inc. actively participates in its local chapter and holds individual memberships. Community Associations Institute, (CAI) America's leading advocate for responsible communities noted as the only national organization dedicated to fostering vibrant, responsive, competent community associations. Their mission is to assist community associations in promoting harmony, community, and responsible leadership. Marshall & Swift / Boeckh, (MS/B) the worldwide provider of building cost data, co-sourcing solutions, and estimating technology for the property and casualty insurance industry found on the web at www.msbinfo.com. R.S. Means CostWorks, North America's leading supplier of construction cost information. As a member of the Construction Market Data Group, Means provides accurate and up-to-date cost information that helps owners, developers, architects, engineers, contractors and others to carefully and precisely project and control the cost of both new building construction and renovation projects found on the web at www.rsmeans.com. Reserve Advisors, Inc., library of numerous periodicals relating to reserve studies, condition analyses, chapter community associations, and historical costs from thousands of capital repair and replacement projects, and product literature from manufacturers of building products and building systems.

For Waterview Estates Owners Association, Inc.

Name:___________________________

Title:____________________________

Date:_______________

Phone:___________________________

Agent or Manager: Kristi Miller

Management Firm: NeighborLink Management

For: Reserve Advisors, Inc.

Signature: _______________________

Jacque MartinDirector of Texas Client [email protected]. # 151249(800) 221-9882

Reserve Study UpdateMay 10, 2016

The Reserve Study for Waterview Estates Owners Association, Inc.Was submitted on ………………………………………………………….May 10, 2016

To maintain the most accurate and cost-effective replacement schedule and funding plan foryour property elements, this study should be updated on or about ..........Second Quarter, 2018…but no later than………………………………………………………….….Second Quarter, 2019

As a valued client, we are pleased to offer a future reserve study update with site visitfor………$3,000For a Reserve Study Update with Site visit as noted above.This future update fee is based on the same property components that were contained in your last ReserveAdvisors’ reserve study or update. We are pleased to include property additions for an additional fee.

To initiate your Reserve Study Update, please sign this authorization and fax or mail to thenumber below. Upon receipt of this authorization we will contact you to schedule your site visitand invoice for the Reserve Study Update Service.

Sign this contract below and fax to 414-272-3663. Or mail toReserve Advisors, Inc.735 N. Water St., Suite 175Milwaukee, WI 53202

Delivery options for your Reserve Study Update Report, Please check one of the following:

____ 1-Full color printed copy PLUS Electronic Report, FREE

____ 2-Full color printed copies PLUS Electronic Report, $100





Documents

Waterview Estates Owners Association, Inc.€¦ · Reserve Advisors, Inc. Years 2016 to 2031 RESERVE EXPENDITURES Explanatory Notes: Waterview Estates 1) 3.0% is the estimated future